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Little Funding Leads to Problems for Littlefeet Inc.

Little Funding Leads to Problems for Littlefeet Inc.

BY MIKE ALLEN

Littlefeet Inc., a Poway-based maker of telecom equipment that increases the coverage of wireless base stations, laid off most of its remaining 45 employees in recent weeks and is shutting down.

CEO John Combs said the company simply was unable to find more venture capital funding to keep its doors open.

“The customers who we are selling to have very long sales cycles and although we were making some progress with some international customers, we didn’t have sufficient revenues to attract additional capital,” Combs said.

Littlefeet attracted about $62 million in venture financing since its inception in April 1999. The largest investors are Com Ventures, Bay Partners, and Sevin Rosen Funds.

Littlefeet’s main products, called Spice, are components installed on light poles and rooftops that increase the coverage of wireless GSM networks. GSM stands for global system for mobile communications, a wireless network technology prevalent in Europe and Asia.

Bob Blumberg, CEO of SMS Technologies, the San Diego-based contract manufacturer for Littlefeet’s products, said he knew the company had a large number of customers, mostly in Europe, Asia, and Africa, using Spice on a trial basis, but didn’t know what kind of sales the firm was generating.

Industry observers expressed shock at Littlefeet’s problems, since recent signals from the telecommunications industry have been positive.

“It’s disappointing this is happening to a company that managed to survive the worst part of the high-tech market implosion,” said Jim Edson, a wireless business consultant and a former Littlefeet employee. “Now that the market seems to be coming back, they didn’t have enough dry powder to participate in the nascent turnaround.”

Tyler Orion, executive director of the San Diego Regional Technology Alliance, said she was surprised to hear of Littlefeet’s woes.

“They were one of the more promising companies among our telecom community, but I guess they just got killed by the global downturn that has been going on for more than three years,” Orion said.

At its peak in early 2000, Littlefeet had about 100 employees, Combs said. He declined to provide any financial information about the privately held firm, including revenues and remaining cash.

He said the firm had been seeking funding from existing and new investors for about six months without success.

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